Defending champion Beatriz Recari (68) is among a group of seven players tied for 14th place at 4-under 138.

Diaz opened her round with five straight pars before tripping to a bogey at the first. That dropped her to 8-under for the tournament and into a tie for the lead with Ko and Pace, who both played in the morning.

Diaz parred her next six holes to remain there before pouring in birdies at the 13th, 15th and 16th around a bogey at the 14th to reclaim the outright lead at 10-under.

She would then close her round with another gain at the 18th to claim a 3- stroke lead heading into the weekend.

"For me, it was just a challenge because I haven't been in this position in a very long time. For sure I haven't had cameras on me in a long time," Diaz said. "So I was anxious for them to go away I think in a funny kind of way."

Ko started her round on the back nine and parred her first two holes before converting three birdies in a 4-hole stretch from the 12th to jump to 7-under.

She later rolled in another birdie at the second to reach minus-8. Ko would trade a bogey at the fourth with a birdie at the fifth to remain there before closing her round with four straight pars.

"I had two solid rounds. I thought I played pretty solid today and yesterday," Ko said. "Hopefully I can continue that through the weekend."

Pace birdied the first, but gave that shot right back with a bogey at the second. After parring her next three holes, she rolled in birdies at the sixth, seventh and ninth to make the turn at 8-under.

Bogeys at the 11th and 15th dropped her back to minus-6, but she bounced back with consecutive birdies at the 17th and 18th to finish at minus-8.

Lee-Bentham was the only player in the morning to reach Diaz's overnight lead as she recorded six birdies over her first 11 holes to reach 9-under, but she closed her round with bogeys at the third and seventh to fall behind.

NOTES: Diaz collected both of her wins in 2002 at the Welch's/Circle K Championship and LPGA Corning Classic ... Diaz has also held the 36-hole lead at this event in 2002, 2003 and 2009. Her best finish in those years was a tie for third in 2002 ... Diaz's last top-10 finish came at the 2010 LPGA Tour Championship ... The cut line fell at 1-over 143, with 77 players advancing to the weekend. Among those to miss the cut were Michelle Wie, Angela Stanford, Gerina Piller and Azahara Munoz.